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Saturday, January 2, 2010

The Fallacy of Taxation With Representation

A pro-State troll says "If you think taxes are too high, then why don't you vote for a candidate who will lower taxes." I don't recall any candidates running on a platform of "I'm eliminating all taxes!"

The fallacy is that the number of people who work directly or indirectly for the government is more than 50%. If 50% of the people work for the government, and they always vote, then it's impossible to achieve reform by voting.

Suppose that voter turnout levels are 50%, and 50% of the people of the people work for the government. If everyone who works for the government votes, then doesn't that imply that real voter turnout rate is 0%?

People who work for the government *MUST* vote, because they're protecting their turf. People who don't work for the government might realize that voting is a waste of time.

The government claims more than 50% of all economic activity, via direct and indirect taxes. "More than 50% of the people work for the government (directly or indirectly)!" seems very likely, given direct taxation rates of more than 50% and a greater indirect taxation rate. It's hard to do an exact calculation.

What careers are direct or indirect State employees?

  1. There's the obvious direct State employees, like policemen, soldiers, firemen, judges, public school teachers, garbage collectors, politicians, and State bureaucrats.
  2. Bankers are indirect State employees. They are dependent on State regulation of the monetary system for their profits. Almost everyone employed in the financial industry is an indirect State employee.
  3. Lawyers are indirect State employees. They are dependent on State regulation of the justice market. If you need to accomplish something in the legal system, you need a lawyer. The rules and procedures of the legal system were written by lawyers. They intentionally made the legal system complicated, so that you need a lawyer whenever you do something. Most lawyers are experts in statutory law and not natural law. A State law degree is useless in a free market justice system based on natural law. You need a State license to work as a lawyer, making a lawyer a partial State employee. If a State-licensed lawyer does something that offends a State bureaucrat, then his law license may be revoked.
  4. Doctors, dentists, accountants, electricians, plumbers, taxi medallion owners, etc. are the beneficiaries of a State licensing cartel. They receive above-market salaries due to State restriction of the market.
  5. People who work for the State telephone/electricity/cable monopoly/oligopoly are indirect State employees.
  6. Unionized workers at Ford/GM/Chrysler are mostly State employees. Unionized airline employees are mostly State employees. Most unionized workers are partial State employees, because they're dependent on the State to earn above-market salaries. By definition, a unionized worker receives an above-market wage for his labor; otherwise, he'd drop out of the union and get another job.
  7. Mainstream media workers are partial State employees. They're dependent on State restriction of the media industry for their profit. If I try to start my own TV show, I wouldn't be able to broadcast it and reach a wide audience unless I find a mainstream media corporation willing to carry it. Self-publishing on the Internet has opened the door somewhat, but it's very hard to build up an Internet audience via organic growth.
  8. There are a lot of private contractors, especially building weapons, who work for the government. They count as employed by the private sector, but they're really government employees.
  9. A private contractor who builds State roads is an indirect State employee.
  10. Executives at a large corporation are State bureaucrats. Managing a corporate bureaucracy isn't the same as managing a free market business. Workers at a large corporation act like cogs in a State bureaucracy, rather than free market workers. Executives at large corporations think they're brilliant leaders, but they're actually best at navigating a State corporate bureaucracy.
There are very few workers who aren't State employees. The only examples I can think of are small business owners/workers in an area that's subject to little/no State regulation.

A small business owner is typically 2x-10x more efficient than workers at a large corporation. This is necessary to overcome the burden imposed by State regulation.

Suppose that the 1% most-skilled workers are 200x more productive than the remaining 99%. In that case, you'll never convince the remaining 99% to vote to reduce taxes on the 1% top performers. That may sound silly, but performance differences of 200x or more are true in the area of software. In other areas of the economy, that may also be true, but you don't notice because other areas of the economy are heavily regulated. For example, someone working at McDonald's may be intelligent, but they're forced to obey the rules and procedures of the McDonald's corporation.

Suppose that the 1% most skilled workers pooled their resources. They produce twice as much wealth as everyone else combined. They should be able to defend their property, if they chose to do so.

The point of agorism is that the most skilled workers drop out of the State economy and create free market alternatives to the State. By preventing parasites from leeching off your labor, you improve your productivity while denying the State resources. Even if the State doesn't collapse during your lifetime, a successful agorist still increases his personal wealth.

Suppose that 51% of the population works directly or indirectly for the government. Suppose there's a referendum on "Should there be a government?" (as if State bureaucrats would ever allow such a question on the ballot anyway) Suppose that 51% vote "yes" and 49% vote "no", but the 51% who voted "yes" are direct or indirect government employees. Does that vote legitimize the government?

More than 50% of the population works directly or indirectly for the government. That makes it hard/impossible to reform the State by voting. The people dependent on the State for their livelihood will *ALWAYS* vote to maintain or increase the size of the government.

Taxation with representation fails because parasites can vote to steal from productive workers. As long as 50% of the population are parasites, reform cannot occur by voting. Welfare and other State perks help create the illusion that a lot of people benefit from government.


Unknown said...

I'm not sure that we can assume that every State worker will always vote to increase taxes to support government programs. For example, those government mandated abstinence-only policies were extremely indirectly and directly fiscally harmful. Yes, the government moved away from it with all the speed of molasses, but it's proof that crappy programs do get cut/reformed if enough people expose them.

I'm also not sure why every public school teacher would support an increase in their local police department's budget. I'm not sure why every State worker is going to support increasing funding for American wars.

Anonymous said...

Correlation does not equal causation.

If you just read your posts into a voice-changer and put them on youtube, you'd get a lot more subscribers.

Anonymous said...

Your remarks about the motivations of insiders/politicians/etc distract from the actions of the insiders. I realize that most people do not laugh with pleasure that 100,000 people will die of starvation, or in a bombing campaign, or whatever, but I disagree that they think they are doing the right thing.

Imagine a goodness value, if you will.

Love thy neighbor 75
Taxation is theft 35
Your total is $3.35 0
Turn the other cheek -95
Cause the economy to crash -70

To me, this is an evil act. But insiders probably say "that's too bad, they (people who lose jobs, mortgages, etc) should have planned better and not overextended themselves)"

That's not direct evil. That's not wishing ill on another person...but the morality of the action itself is worthless...but the justification (the self-talk) is pretty honest and (imo) innocuous. Does that mean the person is worth respect or something? What does it mean to you? What is the value of an insider who believes he is doing the right thing (a useful idiot) relative to one who knows he is doing wrong?

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